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Thursday, July 15, 2004 09:36 pm

Time to clean house

Scandal shows peril of keeping George Ryan’s cronies around

The scandal of the year is not about Jack Ryan's sex life. It's about an obscure little state board that appears to have gotten completely out of hand.

For years, rumors of corruption have swirled around the Illinois Health Facilities Planning Board. As it turns out, those rumors may have been true.

The scandal broke after officials of Edward Hospital in Naperville finally got tired of being shaken down. The hospital, attempting to expand, was allegedly told in no uncertain terms that it had to hire financial giant Bear Stearns and Kiferbaum Construction Corp. Hospital officials eventually agreed to wear a wire for the FBI, and some influential insiders were allegedly caught saying some really stupid things.

Last year, there was some hope that the board would be cleaned up. Gov. Rod Blagojevich asked for, and received, permission from the General Assembly to appoint all-new members, ostensibly to stop the corruption left over from George Ryan's tenure.

Instead, Blagojevich reappointed people like Stuart Levine, the vice chairman. A major Republican donor, Levine was allegedly caught participating in at least one shakedown scheme with Bear Stearns honcho P. Nicholas Hurtgen and Kiferbaum owner Jacob Kiferbaum. Blagojevich also reappointed Bernard Weiner, a close George Ryan friend who, with his son, made more than a million dollars in commissions selling insurance to the hospitals he regulated.

The governor appointed Thomas Beck as the board's chairman. Beck's son works for Bear Stearns, and Beck himself has received "finders' fees" from the same firm, but Beck didn't abstain from voting on projects involving Bear Stearns.

Then in August, Blagojevich appointed Dr. Michael Malek and Dr. Fortunee Massuda, just two weeks after each reportedly forked over $25,000 contributions to the governor's campaign fund.

One of the governor's top campaign fundraisers, Chicago businessman Tony Rezko, recommended several of the appointments, according to a spokesperson for the governor.

A federal whistleblower lawsuit filed by Edward Hospital alleges Hurtgen told hospital officials in January that "he was politically connected to the Illinois state government administration and can 'get things done.' [Hurtgen] stated he was 'responsible' for Bear Stearns being awarded the state of Illinois'... $10 billion pension underwriting deal." The lawsuit also alleges a kickback scheme was connected to the pension bond deal, which Blagojevich pushed through the legislature in 2003.

Last year, when the governor's $10 billion pension-bond bill passed, Tony Rezko was listed as a lobbyist in a firm with National Republican Committeeman Bob Kjellander, who reaped an eye-popping $800,000 fee from Bear Stearns after the deal was closed. Kjellander subsequently removed Rezko from the lobbyist list, explaining that he had long ago ceased to do business with him. Kjellander, however, has never explained what he did to earn that fee.

Neither Rezko nor Kjellander has been accused of wrongdoing, and I'm not even sure who the real insider was in all this. Most of George Ryan's old pals (those who aren't in jail, at least) have shown an astounding ability to adapt to the changing times, hiring the new governor's friends as their lobbyists and consultants, and worming their way into Blagojevich's good graces.

It's time to clean house, or someone may be going to the big house.

 

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